Child benefit withdrawal will make it better to work less for families with over seven children

And come 2076, that will be the case for every family in the nation.

The child tax credit withdrawal, taking effect on Monday, will lead to marginal tax rates of over 100 per cent on families with more than eight children earning between £50,000 and £60,000.

The IFS explains how the marginal rates are calculated:

Affected taxpayers will pay back one per cent of their family’s Child Benefit for every £100 by which taxable income exceeds £50,000. One per cent of Child Benefit is £10.56 per year for a 1-child family, and an additional £6.97 per child for larger families. Hence the marginal tax rate between £50,000 and £60,000 is increased by about 11 percentage points for the first child and by an additional 7 percentage points for each subsequent one. So, for example, while about 320,000 people will find that their marginal income tax rate increases to more than 50%, about 40,000 of them - those with three or more children - will find that it jumps to at least 65%.

They offer a chart with the rate calculated up to four children:

By seven children, the marginal rate rises to 99.35 per cent, and by eight, it breaks 100 per cent (106.32 per cent, to be exact). This means that any individual with a family of eight kids earning between £50,000 and £60,000 would be better off if they reduced their salary back down to £50,000. In fact, for that individual, they would have to earn £61,105 before their post-tax income was the same as it was at £50,000.

It's unclear whether any families actually exist matching that criterion - rather wonderfully, my back-of-the-envelope maths (which assumes that the exponential decrease in the number of families of each size continues: e.g., there are 1/8th the number of families with three or more kids as there are with two or more, so I'm assuming that there are correspondingly 1/8th the number of families with four or more as there are with three or more, and so on) suggests that there may be exactly one – but even if there are none at the moment, there's no reason why there won't be one in the future. Families with eight children do, after all, exist.

In fact, as time goes on, this problem will get worse. The IFS points out that child benefit is uprated with inflation, while tax bands aren't. Currently, each extra child after the first increases your "marginal tax rate" by around seven per cent, but suppose child benefit is uprated by two per cent a year. In that case, the marginal tax would exceed one hundred per cent for families with seven children next year; for six children in the year 2020; for five children in the year 2028; and, eventually, for families with just one child – i.e., every family – in the year 2076.

Hopefully the law will be changed before then, of course. But as a rule of thumb, laws which become ridiculously damaging unless you actively intervene ought not be signed in the first place. Oops.

Children. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Getty
Show Hide image

Four times Owen Smith has made sexist comments

The Labour MP for Pontypridd and Jeremy Corbyn’s Labour leadership rival has been accused of misogynist remarks. Again.

2016

Wanting to “smash” Theresa May “back on her heels”

During a speech at a campaign event, Owen Smith blithely deployed some aggressive imagery about attacking the new Prime Minister. In doing so, he included the tired sexist trope beloved of the right wing press about Theresa May’s shoes – her “kitten heels” have long been a fascination of certain tabloids:

“I’ll be honest with you, it pained me that we didn’t have the strength and the power and the vitality to smash her back on her heels and argue that these our values, these are our people, this is our language that they are seeking to steal.”

When called out on his comments by Sky’s Sophy Ridge, Smith doubled down:

“They love a bit of rhetoric, don’t they? We need a bit more robust rhetoric in our politics, I’m very much in favour of that. You’ll be getting that from me, and I absolutely stand by those comments. It’s rhetoric, of course. I don’t literally want to smash Theresa May back, just to be clear. I’m not advocating violence in any way, shape or form.”

Your mole dug around to see whether this is a common phrase, but all it could find was “set back on one’s heels”, which simply means to be shocked by something. Nothing to do with “smashing”, and anyway, Smith, or somebody on his team, should be aware that invoking May’s “heels” is lazy sexism at best, and calling on your party to “smash” a woman (particularly when you’ve been in trouble for comments about violence against women before – see below) is more than casual misogyny.

Arguing that misogyny in Labour didn’t exist before Jeremy Corbyn

Smith recently told BBC News that the party’s nastier side only appeared nine months ago:

“I think Jeremy should take a little more responsibility for what’s going on in the Labour party. After all, we didn’t have this sort of abuse and intolerance, misogyny, antisemitism in the Labour party before Jeremy Corbyn became the leader.”

Luckily for Smith, he had never experienced misogyny in his party until the moment it became politically useful to him… Or perhaps, not being the prime target, he simply wasn’t paying enough attention before then?

2015

Telling Leanne Wood she was only invited on TV because of her “gender”

Before a general election TV debate for ITV Wales last year, Smith was caught on camera telling the Plaid Cymru leader that she only appeared on Question Time because she is a woman:

Wood: “Have you ever done Question Time, Owen?”

Smith: “Nope, they keep putting you on instead.”

Wood: “I think with party balance there’d be other people they’d be putting on instead of you, wouldn’t they, rather than me?”

Smith: “I think it helps. I think your gender helps as well.”

Wood: “Yeah.”

2010

Comparing the Lib Dems’ experience of coalition to domestic violence

In a tasteless analogy, Smith wrote this for WalesHome in the first year of the Tory/Lib Dem coalition:

“The Lib Dem dowry of a maybe-referendum on AV [the alternative vote system] will seem neither adequate reward nor sufficient defence when the Tories confess their taste for domestic violence on our schools, hospitals and welfare provision.

“Surely, the Liberals will file for divorce as soon as the bruises start to show through the make-up?”

But never fear! He did eventually issue a non-apology for his offensive comments, with the classic use of “if”:

“I apologise if anyone has been offended by the metaphorical reference in this article, which I will now be editing. The reference was in a phrase describing today's Tory and Liberal cuts to domestic spending on schools and welfare as metaphorical ‘domestic violence’.”

***

A one-off sexist gaffe is bad enough in a wannabe future Labour leader. But your mole sniffs a worrying pattern in this list that suggests Smith doesn’t have a huge amount of respect for women, when it comes to political rhetoric at least. And it won’t do him any electoral favours either – it makes his condemnation of Corbynite nastiness ring rather hollow.

I'm a mole, innit.